The CFO'S Perspective

Our CFOs get asked about business exit options a lot, especially these days. Business owners that are looking to step away to pursue other endeavors, interested in cashing out to get the full value of their hard work, or nearing retirement all wonder when they should make their move to maximize their gain.

While last year’s expected Federal tax rate increases did not happen, there is still lingering apprehension around the timing of exiting your business. So, though the urgency we witnessed last year has dissipated, the ongoing question still remains: should you sell your business this year, next year, or not at all?

A prospective consultant told me that he loved what he did during a recent interview. He had been working up the ranks for a long time, continually added skills and experience, and was in a place of high trust and value to his organization. He shared with me that he loved his profession had excellent skills but was not interested in working 70 hours a week at this point in his life and career. He asked, "Were there other options?"

Employers that want their employees back in the office again are asking themselves the question, “How do I get my employees to return to work?” However, many employees are asking their employers, “Why should I return to work?” in response.

The resulting dichotomy has created a sticky situation for companies that are facing labor shortages and revenue challenges well over a year and a half into this crisis. For key departments like accounting and finance, the pressure is further elevated because these kinds of skilled roles are a hot commodity right now, making them even harder to replace.

At CFO Selections, we work with many types of companies, from the large and complex to those more straightforward and easier to understand. They have vastly different finance and accounting structures. One size or type certainly does not fit all.

When a key employee leaves, hiring a replacement is of paramount importance. But when it is going to take considerable time to find the right person to fill the vacant role or a hired replacement cannot start right away, an interim hire is used to bridge the gap.

So, who do you turn to when you need help with interim employment?

Hiring managers may ask, “Does it matter who we bring in to help us hire an interim position, anyways?” and “Do we need to spend much money to hire someone that we only plan on keeping around for a short time?” The ubiquity of staffing companies makes them an attractive choice for inexpensive hires in individual contributor roles. But what about interim executive leadership roles?

A role like the CFO position needs to be filled with an experienced professional who is ready to lead the organization. As CFO Magazine explains,

“Leadership voids are particularly perilous when it comes to the CFO position. CFOs are the ultimate utility players in an organization — they’re captains of detail orientation. They need to seamlessly interact with all parts of the company to gather and disseminate information. At the same time, they need to be a strategic thought partner with the CEO. Having this seat empty can cause the best of companies to stall. Interim CFOs keep a company in a safe pair of hands. They provide stability by offering critical financial reporting and business intelligence and moving key projects forward. Interim CFOs enable proactive companies to keep the momentum going. They also, maybe most importantly, allow them to take their time to find the right next full-time finance chief (vs. rushing to hire whoever is available at a moment’s notice).”

The importance of the CFO role begs the question, do professional services firms provide an advantage for these types of hires? What sets them apart from staffing agencies? And do these advantages justify their premium pricing?

Regardless of what precipitates a recession, economic ebbs and flows are to be expected over time. Recessions can be caused by a period of contraction that inevitably comes after economic expansion or a sudden and unexpected economic shock.

While the coronavirus recession is fresh on our minds, it is not the first nor will it be the last recession that today’s businesses face. Knowing how to weather a recession is an essential management skill regardless of how long it lasts. However, facing a prolonged recession poses unique challenges that can test even the most adept leaders.

Our team of experienced CFOs shares their top tips on getting through a recession and coming out stronger on the other side:

Like any other c-suite hiring process, hiring a CFO can be a daunting process at any organization. Whether the role is a newly opened position at a burgeoning startup, or a replacement for a long-standing CFO that is looking to retire, bringing in a CFO is a complex endeavor.

For companies that are accustomed to using recruiting services, the idea of using an executive placement agency to hire a key leadership role is a logical extension. However, businesses that typically handle hiring in-house may not see the benefit to using an executive search firm to hire a CFO. Some business owners may not even know that there are niche executive search agencies that specialize in finance roles.

However, using an executive search firm that focuses specifically on hiring key finance positions offers numerous benefits, which typically include:

The current economic climate, combined with the fact that September is National Preparedness Month, has many of us thinking about how we can prepare for possible threats and business disruptions. This kind of strategic planning allows a business to approach a worst-case scenario with a growth mindset instead of fear – increasing the likelihood that your business will come out of a crisis stronger for having gone through it.

During a worst-case scenario, leadership must decide whether the organization will make the necessary adjustments needed to continue with business as usual or change how the company will operate. And while the conversation will undoubtedly include operational and capacity considerations, it is primarily a discussion about financial capabilities.